Dollar Could Fall if Next Fed Chair Pursues Unwarranted Rate Cuts — Market Talk

Dow Jones Newswires

1014 GMT - The dollar could suffer if Kevin Hassett, the expected pick to be the next Federal Reserve chair, pursues interest-rate cuts regardless of whether this is warranted, Commerzbank's Volkmar Baur says in a note. In an interview with Fox News shortly before the Fed's rate cut Wednesday, Hassett said the central bank was "way behind" in lowering rates. However, data show the labor market is only cooling very slowly and this doesn't support Hassett's assertion, Baur says. Hassett probably won't be dissuaded by facts from delivering the rate cuts President Trump wants, he says. "And the dollar might have to pay the price." The DXY dollar index rises 0.1% to 98.418 after hitting a near eight-week low of 98.134 Thursday. (renae.dyer@wsj.com)

1008 GMT - The cost of insuring European credit against default falls as market sentiment improves. "Europe saw a strong rally across the board as investors dialed back the chance of an ECB rate hike next year," Deutsche Bank Research strategists say in a note. The iTraxx Europe Crossover index, which tracks euro high-yield credit default swaps, falls 2 basis points to 246bps, S&P Global Market Intelligence data show. (miriam.mukuru@wsj.com)

1001 GMT - BlueBay Asset Management is inclined to think that the current rise in European government bond yields starts to present a buying opportunity to add duration, including in Norway, CIO Mark Dowding says in a note. "Here we would draw attention to Norwegian yields, where Norges Bank maintains cash rates at 4%, but rate cuts are expected as inflation across Scandinavian economies drops in the months ahead," Dowding says. The 10-year Norwegian government bond yield rises 1.3 basis points to 4.18%, while the 10-year Bund yield is up 1.4bps at 2.859%, according to Tradeweb data. (emese.bartha@wsj.com)

0959 GMT - Increased investment by the German government is finally starting to show up in hard data, Berenberg analysts say in a note. "German data for industrial production in October confirm that the additional public spending on defense and infrastructure is starting to lift economic activity," the analysts say. Despite overseas orders taking a hit amid trade volatility, demand at home is strengthening, they say. The volume of new orders increased by 2.7% above average for the third quarter, driven by a 10% uptick in domestic orders. "Over time, the resulting gains in employment, private sector confidence and corporate earnings should finally encourage more consumer spending and business investment beyond the defense and construction sectors," the analysts add. (don.forbes@wsj.com)

0959 GMT - Ten-year Japanese government bond yields have found some support close to 2% in the past week and BlueBay Asset Management has reduced its short duration stance around this level, says CIO Mark Dowding in a note. "Although we still see yields trending higher, the recent move has been relatively rapid by Japanese standards and so a period of some consolidation should be anticipated," he says. Looking into 2026, BlueBay AM continues to think 30-year JGBs can outperform other maturities, as supply and demand comes more into balance, he says. In addition, absolute yield levels are "intrinsically appealing to Japanese domestic investors." (emese.bartha@wsj.com)

0932 GMT - Chinese policymakers' tone around stabilizing the property sector was more urgent than expected, HSBC Global Research analysts write in a note. The key task for 2026 will be promoting domestic demand through consumption and investment, supported by new policy financing tools and urbanization projects, they say. The government has a stronger stance than expected on the property sector, as it flagged the need to stabilize the industry and "implement city-specific policies to control new supply, reduce inventory and optimize supply," the analysts say. If the government were to go beyond just incremental measures and take a larger step to support the property sector, there might be some positive upsides, they add. (jiahui.huang@wsj.com; @ivy_jiahuihuang)

0908 GMT - The rand rises to its highest level against the dollar since January 2023 and could strengthen further, Commerzbank's Volkmar Baur says in a note. "There are increasing signs that the South African economy is on the upswing." The economy registered its fourth consecutive quarter of growth in the third quarter. A potentially solid fourth quarter would mark the longest period of growth since 2018, and this should carry momentum into 2026, he says. Falling interest rates and an improved credit rating should also support investment. The rand has been on an upward trend for two years and this trend could continue, he says. The dollar falls to a low of 16.8118 rand, according to LSEG. (renae.dyer@wsj.com)

0855 GMT - China's tone on the property sector has been more positive of late, according to Citi analysts. They note that the Central Economic Work Conference this week said Beijing will "take proactive steps to defuse risks in key areas." The language still comes across as less "decisive" than last year's CEWC, the analysts say in a research note. Citi thinks the new round of demand-side local stimulus, such as subsidies on home purchases or mortgage interest rates, might help. But these "are unlikely to alter home-price expectations given abundant supply on mounting secondary listing," the analysts write. "We would watch for targeted monetary easing or pro-leverage initiatives but see low likelihood for now." (tracy.qu@wsj.com)

0854 GMT - Barring a boost in growth towards the end of the year, the U.K. economy could record a contraction in the final quarter of 2025 after data showed the economy contracted in October, Investec's Philip Shaw says in a note. U.K. GDP declined 0.1% in October, weaker than the consensus forecast of 0.1% growth by economists in a WSJ poll. "Without a material upturn in momentum towards the end of the year, the economy will post a quarterly contraction in the fourth quarter for the first time in two years," Shaw says. (miriam.mukuru@wsj.com)

0846 GMT - The U.K. economy contracted by 0.1% in October, and growth is set to remain weak for the remainder of the fourth quarter, with activity in November likely constrained because of uncertainty over the government's budget, Yael Selfin, chief economic at KPMG UK says in a note. Despite the budget avoiding frontloaded tax hikes and borrowing costs set to fall over the coming year, its effects are likely to linger and household sentiment may not improve in the near term, she says. The outlook for investment growth is more positive, which should remain a key contributor to growth going into 2026, Selfin says. Nevertheless, GDP growth is expected to be flat in the final quarter of 2025, she says. (edward.frankl@wsj.com)

0846 GMT - While the level of U.S. debt is a headwind for the economy and markets, it should be manageable, Citi's Nathan Sheets says in a note. "Any premiums that the market requires to absorb the forthcoming Treasury issuance do not significantly restrain economic growth or the government's ability to borrow," the global chief economist says. The core strengths of the U.S. economy--including its resilience and dynamism--give investors the confidence to purchase the debt, notwithstanding the high levels of indebtedness and political noise, he says. "And, at the end of the day, there are few alternatives to Treasuries." (emese.bartha@wsj.com)

0838 GMT - Yields on eurozone government bonds rise, tracking moves in their U.S. counterparts. U.S. Treasury yields turn higher, reversing some of their falls the previous day after the Federal Reserve lowered interest rates and left open the door to further cuts. Deutsche Bank analysts say yields were helped higher after the Fed unanimously reappointed 11 regional bank presidents to the Fed's board. This eased some concerns over Fed independence and the prospect of pressure to cut interest rates, they say. Still, moves are limited as eurozone bond investors brace for a busy week next week, which will include a European Central Bank announcement and U.S. inflation data. The 10-year German Bund yield rises 0.9 basis points to 2.854%, Tradeweb data show. (jessica.fleetham@wsj.com)

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Royal Bank of Canada Price Target Raised to C$229.00/Share From C$220.00 by CIBC World Markets

Dow Jones Newswires

Royal Bank of Canada

-0.69%

Ratings actions from Baystreet: http://www.baystreet.ca

(16:42 GMT) Royal Bank of Canada Is Maintained at Neutral by CIBC World Markets

Ratings actions from Baystreet: http://www.baystreet.ca

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RBC Capital Markets hikes Berkeley target price

ShareCast

Royal Bank of Canada

-0.69%

RBC Capital said Berkeley was "like a swan", noting that "the serene, smooth and graceful performance we see masks the hard work going on below the surface", as the firm manages "blustery market winds and the ebbs and flows of planning regulations".

"In challenging times there are few surprises for Berkeley's shareholders," said RBC.

The Canadian bank stated Berkeley believes that the housing market tide was in the process of turning, but that we have not yet reached the inflexion point, and despite the long-term attractions, the feel good factor has "yet to take to the London stage".

While RBC Capital reiterated its 'underperform' rating on the stock, it remains "equally impressed" by Berkeley's ability to deliver whatever the weather.

"We have done some necessary housekeeping to our estimates to reflect the growth in net asset value per share and the guidance both within today's results statement and our interpretation of the additional colour provided during the analyst meeting. We have also tweaked down our valuation multiple from 1.1x to 1.0x to reflect the absence of the necessary feel good factor and the fact that, although changes to planning and regulation are in the pipes, those pipes appear to be blocked in places rather than free flowing," concluded RBC.

Reporting by Iain Gilbert at Sharecast.com

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BNP Paribas Takes Profit on Short 10-Year U.S. Treasury Trade After Fed — Market Talk

Dow Jones Newswires

Royal Bank of Canada

-0.69%

0904 GMT - BNP Paribas takes profit on a short 10-year U.S. Treasury trade--which bet on a rise in yields--after the U.S. Federal Reserve cut interest rates as expected on Wednesday, its analysts say in a note. BNP Paribas entered the trade at 4.09% and closed it at 4.15%. "We see the Federal Reserve's imbalanced reaction function weighing on the rates markets ahead of the next payrolls data," they say. Although the Fed's vote was split, policymakers are placing emphasis on U.S. labor market's weakness. The 10-year Treasury yield falls 3.1 basis points to last trade at 4.132%, according to Tradeweb. (emese.bartha@wsj.com)

0859 GMT - China needs coordinated real-estate and monetary policies to break the downward spiral in property prices, according to Citi analysts. They note that real estate accounts for about two-thirds of Chinese household assets, making it essential for Beijing to stabilize property prices. The analysts warn that China's property prices could continue to decline in 2026, though average selling prices of new homes could fall at a milder pace thanks to better products. Purchase subsidies are expected help the property market but are unlikely to alter home-price expectations, they say in a research note. "We would watch for targeted monetary easing or pro-leverage initiatives but see low likelihood for now." (sherry.qin@wsj.com)

0852 GMT - The Swiss franc edges slightly higher after the Swiss National Bank kept interest rates unchanged at 0%, as widely expected, and sounded more optimistic about economic growth following a recent deal to lower U.S. tariffs on Swiss goods. The central bank said the economic outlook has improved slightly due to lower U.S. tariffs and somewhat better global developments. The SNB said inflation has been slightly lower than expected in recent months. However, inflationary pressures are virtually unchanged in the medium-term compared to the last assessment. The SNB reiterated that it remains willing to be active in the foreign exchange market as necessary. The euro falls 0.1% to 0.9345 francs after the decision, from 0.9357 beforehand. (renae.dyer@wsj.com)

0844 GMT - The latest RICS U.K. Residential Market Survey shows both buyer demand and sales volumes in negative territory, reflecting the initial reaction to the U.K's autumn budget, RBC Capital Markets analysts Anthony Codling and Oliver Dyson say in a note. The buildup to the budget was draining for those involved in the property market with November's new buyer enquiries being the weakest reading since late 2023, the analysts say. "U.K. households love the smell of Rightmove on Boxing Day morning (we expect record viewing figures), and we believe that RICS' December survey will be more upbeat than the post-budget November edition," the analysts say. Persimmon shares are down 0.8%, followed by Berkeley, down 0.5% and Vistry, down 0.1%. (anthony.orunagoriainoff@dowjones.com)

0843 GMT - The Bank of Thailand could cut its policy rate by 25 bps next week and by another 25 bps in 2026, says Barnabas Gan, RHB Bank's group chief economist, in a report. There's a need for a more accommodative stance to support the economy, given persistently soft inflation and downside risks to growth, particularly from muted domestic demand. The Thai baht's recent strength also reinforces the case for monetary easing, aligning with the BOT's objective of mitigating currency volatility and supporting tourism as well as exports. Gan also notes BOT Gov. Vitai Ratanakorn's recent remarks that there is still room to cut rates, citing soft domestic demand and below-target inflation. (amanda.lee@wsj.com)

0841 GMT - China's consumer price index may hold up in the near term before easing in 1Q, according to BofA Securities economists in a research note. "It is encouraging to see an improvement in CPI inflation in November," they say. With food-prices surprises to the upside and continued improvement in clothing prices, December CPI is likely to remain close to November's level, they note. BofA remains cautious about the inflation outlook from 1Q onwards, mainly because weak domestic demand might weigh on overall price recovery. (tracy.qu@wsj.com)

0829 GMT - Yields on U.K. government bonds fall, tracking their U.S. and eurozone peers, after the U.S. Federal Reserve on Wednesday voted in favor of an interest rate cut, albeit in a split vote. Fed Chair Jerome Powell expressed concerns about a weak labor market, causing Treasury yields to fall as investors concluded that further rate cuts were possible. Gilt investors will now turn their attention to a Bank of England rate decision in a week's time, where a rate cut is also expected. Money markets price a 91% chance of a 25 basis-point rate reduction at this meeting, LSEG data show. The 10-year gilt yield falls 2 basis points to last trade at 4.493%, Tradeweb data show. (miriam.mukuru@wsj.com)

0806 GMT - The Swiss franc should show little reaction if the Swiss National Bank holds rates at 0% in a decision at 0830 GMT, Commerzbank's Michael Pfister says in a note. "The Swiss franc's reaction to today's meeting is likely to be muted - unless the SNB surprises us again." Swiss interest rates are likely to remain at 0% for the time being due to concerns over the potential side effects of negative interest rates, he says. Meanwhile, the SNB's concerns about a strong Swiss franc have "receded into the background in recent months." The euro is steady at 0.9355 francs. It hit a three-month high of 0.9395 earlier this week, having rebounded from a multiyear low of 0.9177 hit on Nov. 14, LSEG data show. (jessica.fleetham@wsj.com)

0803 GMT - Bitcoin falls as downbeat results from Oracle revived concerns about an artificial intelligence bubble. The cloud computing company reported disappointing quarterly revenue and raised its spending forecast. The results erased earlier optimism driven by the Federal Reserve's decision Wednesday to cut interest rates and signal further cuts, IG analysts say in a note. This is dragging global stock futures lower, putting pressure on European tech shares and "contributing to a broader risk-off move that also saw bitcoin fall." Bitcoin falls 2.3% to $90,222, LSEG data show. (renae.dyer@wsj.com)

0800 GMT - China's consumption likely remained muted in November, according to Goldman Sachs economists in a research note. Retail-sales growth likely slowed to 2.3% year-over-year compared with 2.9% year-over-year in October despite a low base of comparison, they say. This is mainly due to falling auto-sales growth and negative distortion from an earlier-than-usual start of the "Singles' Day" online shopping festival, they note. The sales campaign pulled forward some demand to October from November, similar to the pattern observed in June, when the June 18 midyear online shopping festival takes place, they say. China's November activity data are scheduled for release on Monday. (tracy.qu@wsj.com)

0740 GMT - Yields of eurozone government bonds decline in early trade, following the direction of U.S. Treasury yields, but the magnitude of the falls is less pronounced. The falls have been largely driven by the market's takeaway from Federal Reserve Chair Jerome Powell's comments after the Fed's 25-basis-point rate cut, with visibly more focus on labor market weakness than on inflation. "Powell stressed greater importance on the weakness in the labor market while inflation was 'somewhat' elevated," Jefferies' Mohit Kumar says in a note. That said, the vote was divided, signaling cautious move by the Fed ahead. The 10-year German Bund yield declines 1 basis point to 2.850%, according to Tradeweb. (emese.bartha@wsj.com)

0735 GMT - The dollar stays under pressure after hitting a seven-week low overnight following the Federal Reserve's decision to cut interest rates and signal further cuts. The Fed delivered a 25 basis-point rate reduction, as expected, but sounded less cautious about further policy easing than anticipated. Fed Chair Jerome Powell's statement seemed to suggest the risks of higher inflation are less dramatic than the risks of a weaker labor market, Commerzbank's Michael Pfister says in a note. "This could pave the way for further interest-rate cuts in the coming year, following a pause in January." The DXY dollar index falls 0.1% to 98.667 after reaching a low of 98.537 overnight. (renae.dyer@wsj.com)

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Big Canadian Banks Likely to Carry Strong Capital Markets Momentum — Market Talk

Dow Jones Newswires

Canadian Imperial Bank of Commerce

+0.22%

Royal Bank of Canada

-0.69%

The Toronto-Dominion Bank

-0.45%

The momentum in the big Canadian banks' capital markets operations looks set to continue in 2026, albeit likely at slower pace than the record levels seen in 2025, Morningstar DBRS analysis suggests. It expects activity in the new year will be driven by investment banking revenue as trading revenue likely normalizes, despite lingering macroeconomic uncertainty. Aggregate capital markets revenue for the six biggest banks rose 22% on-year in the second half of fiscal 2025, buoyed by elevated trading revenue and a significant acceleration in underwriting and advisory activity, Morningstar says. It notes North American and global stock indexes are at or near record highs, driving equity trading and issuance volumes, while merger and acquisition activity is also robust. (robb.stewart@wsj.com)

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REG - Royal Bank of Canada - Publication of a Prospectus

London Stock Exchange

Royal Bank of Canada

-0.69%

RNS Number : 0615L Royal Bank of Canada 10 December 2025

Regulatory Announcement

RNS Number: 0615L

Royal Bank of Canada

December 10, 2025

Publication of Prospectus

Not for release, publication or distribution, directly or indirectly, in or into the United States.

The following prospectus has been approved by the Financial Conduct Listing Authority is available for viewing:

2nd Supplementary Notes Base Prospectus dated December 10, 2025 relating to the Programme for the Issuance of Securities of Royal Bank of Canada.

The 2nd Supplementary Notes Base Prospectus, together with the documents incorporated by reference therein, have been submitted to the National Storage Mechanism and will shortly be available for inspection at: https://data.fca.org.uk/#/nsm/nationalstoragemechanism.

DISCLAIMER - INTENDED ADDRESSEES

Please note that the information contained in the Notes Base Prospectus dated July 9, 2025, as supplemented by the 1st Supplementary Notes Base Prospectus dated August 28, 2025 and the 2nd Supplementary Notes Base Prospectus dated December 10, 2025 (together, the "Prospectus"), may be addressed to and/or targeted at persons who are residents of particular countries (specified in the Prospectus) only and is not intended for use and should not be relied upon by any person outside these countries and/or to whom the offer contained in the prospectus is not addressed. Prior to relying on the information contained in the Prospectus you must ascertain from the Prospectus whether or not you are part of the intended addressees of the information contained therein.

The Notes have not been and will not be registered under the United States Securities Act of 1933, as amended (the "Securities Act") or the securities laws of any state of the United States and are subject to United States tax law requirements. Subject to certain exceptions, the Notes may not be offered, sold or delivered, directly or indirectly, in or into the United States or to or for the account or benefit of a "US person" (as defined in Regulation S under the Securities Act). No public offering of the Notes is being made in the United States. This announcement does not constitute an offer to sell or a solicitation to buy securities in the United States or in any other jurisdiction where such offer or solicitation would be unlawful.

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To view the full document, please paste the following URL into the address bar of your browser.

2nd Supplementary Notes Base Prospectus dated December 10, 2025

http://www.rns-pdf.londonstockexchange.com/rns/0615L_1-2025-12-10.pdf

Documents Incorporated by Reference (or certain portions thereof as specified under "Documents Incorporated by Reference" in the Prospectus):

2025 Annual Information Form dated December 2, 2025

http://www.rns-pdf.londonstockexchange.com/rns/0615L_2-2025-12-10.pdf

2025 Annual Report

http://www.rns-pdf.londonstockexchange.com/rns/0615L_3-2025-12-10.pdf

For further information, please contact

Paul Burd

Senior Counsel

Royal Bank of Canada

Telephone Number: (437) 925-9253

Email: paul.burd @rbc.com

END

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Royal Bank Of Canada To Redeem Series BR Preferred Shares And Series 2 NVCC AT1 Notes

dpa-AFX

Royal Bank of Canada

-0.69%

OTTAWA (dpa-AFX) - Royal Bank of Canada (RY, RY.TO) announced plans to redeem all of its issued and outstanding Non-Viability Contingent Capital (NVCC) Non-Cumulative 5-Year Fixed Rate Reset First Preferred Shares, Series BR on January 24, 2026, at a cash redemption price of $1,000 per share, payable on January 26, 2026.

As a result of this redemption, all outstanding NVCC Additional Tier 1 (AT1) 4.00% Limited Recourse Capital Notes, Series 2, due February 24, 2081, will also be automatically redeemed on the same date at 100% of principal plus accrued interest up to, but excluding, the redemption date.

There are currently 1.25 million Series BR Shares outstanding, and the principal amount of Series 2 LRCN outstanding is $1.25 billion. Together, these securities represent $1.25 billion of capital, with the redemptions to be financed from Royal Bank of Canada's general corporate funds.

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